As part of the negligence doctrine, premises liability sets forth the fundamental duties owed by an owner or occupier of land to protect those entering the land from any injury due to a dangerous condition or defect.Mere ownership of a parcel of land will not support liability for injuries that occurred on the property, unless the owner was negligent.The owner must have a duty to the occupier, breach such duty, and such breach proximately causes the injuries.
In premise liability actions, Courts will first determine the status of the person entering the land. Many jurisdictions, including New York, distinguish between licensees, invitees, and trespassers. An owner or occupier of land or building maintains a duty to warn or make safe any known conditions that are nonobvious and dangerous to any licensee, which includes a social guest.
Moreover, an owner or occupier of land or building maintains a duty to undertake reasonable inspections to discover nonobvious dangerous conditions and provide warnings or take appropriate actions that make the premises safe for any invitee, which includes business visitors or members of the public.
In contrast, an owner or occupier of land or building owes no duty to an undiscovered trespasser regardless if the condition occurs naturally or artificially.On the other hand, the knowledge of a trespasser’s presence elevates a landowner’s duty towards warning or remedial measures of nonobvious or dangerous artificial conditions.
Based on the approach of a majority of jurisdictions, a guest under the Airbnb model holds most likely holds the status of an invitee because the guest came to the host’s property at the initiation of the host/owner/occupant. Therefore, an Airbnb host owes the highest legal duty towards guests – the duty to keep the guest safe from unreasonable risks and dangers that the host knows about or “should have known about.”Additionally, an Airbnb host may face liability if the host failed to exercise reasonable care to discover dangerous risks in a situation where guests would not be expected to identify or protect themselves from.As a host on Airbnb you may face liability due to conditions that you should have known about. Therefore, it is encouraged to conduct a thorough inspection periodically and before listing on any online hospitality service.
In some instances, owners or occupiers in adjourning apartments or homes may pursue a nuisance claim due to the presence of repeated guests and their conduct causing a disturbance.
Courts have drawn distinctions between two types of nuisances – Public Nuisance and Private Nuisance. A Public Nuisance is defined as one that affects an entire neighborhood or community. Moreover, a Public Nuisance is unreasonable interference with a right common to the general public. For example, this would include conduct that creates an unreasonable interference with the public right, that inhibits the public health, public safety, public peace, or public convenience.
Private Nuisance is one that only disturbs a single adjacent owner or neighbor. For example, a private nuisance may occur due to the actions of the guest on the host’s property that disturbs a neighboring tenant. Courts have provided further clarification of “substantially” or “unreasonably,” stating that the injured parties must show a personal injury that is beyond a mere inconvenience whereby a person in the community of normal sensitivity would be seriously bothered.
Property Damages – Airbnb’s Policy May Not be Adequate
In an Airbnb arrangement, both the host and the guest may face claims for property damage or loss. For example, a host may face property damage or loss due to criminal conduct (theft) of a guest. On the other hand, a guest may face additional liability due to the loss or damage of the host’s property.
Airbnb allows a host to obtain a security deposit from the guest to protect the host’s property, however, it comes with some conditions. These conditions include the requirement that a host notify Airbnb of a claim within 14 days of the checkout date or before the next guest checks in, whichever is earlier.In these cases, should a host decide to file a claim, Airbnb will only mediate and collect payment from a guest. Therefore, if either party contends the claim, the mediation may fail to resolve the dispute.
Insurance As a Proposed Solution
Due to the array of potential Airbnb liability issues, additional private insurance could stand as a solution to risk management. Insurance can provide additional assurances, piece of mind, and financial savings if there is loss from unforeseen circumstances.
In most cases, a typical homeowner’s insurance policy may exclude liability coverage for the “business pursuits” of any insured.The “business pursuit” exclusion has been applied by courts in cases such as operating a business out of a home and providing childcare services. Courts generally apply a two-part test in determining whether conduct constitutes “business pursuit.” First, if there is continuity in the insured’s activity and secondly, the presence of a profit motive. If a host rents their property consistently, multiple times in a given period, courts may find continuity. Moreover, the profit motive will be easily established as it is likely the primary motivation behind listing on Airbnb.
In 2015, Airbnb expanded beyond their Host Guarantee Program from just offering property damage coverage to providing coverage for third-party claims of both bodily injury and/or property damage through a Host Protection Insurance program. Additionally, insurance carriers like Allstate are expanding their insurance coverage and including similar Host Advantage Property Coverage. We encourage those either hosting or renting on any online marketplace hospitality website to do research on your homeowner or renter insurance policy.
The information above is intended to provide limited information only and is not legal advice. The laws relating to tort, nuisance, and property damage in New York are complex. If you are a party to a matter concerning an Airbnb/online marketplace hospitality service and otherwise need further guidance in this or a related area of law, Singh & Rani, LLP can assist you.
LOUIS A. LEHR, JR., 2 PREMISES LIABILITY 3D Generally § 36:1, Westlaw (database updated August 2016). Generally, the discussion of premises liability solely pertains to real property; but the courts in Indiana decided to extend it to a large houseboat used by its owners as a weekend getaway and equipped with a kitchen and bathroom. (See Harris v. Traini, 759 N.E.2d 215 (Ind. Ct. App. 2001).) Given the diversity of listings on Airbnb, it is possible that this type of precedent may become applicable.
Restatement (Second) of Torts § 330 cmt. 3 (Am. Law Inst. 1975).
See W. PAGEKEETON, ET. AL., PROSSER ANDKEETON ON THE LAWOF TORTS § 30 (5th ed. 1984).
See Id. at § 58.
Restatement (Second) of Torts § 821B (Am. Law Inst. 1975).
See How does Airbnb handle security deposits?
See Roger O. Steggerda, Note, Watching Your Neighbor’s Child: Is Babysitting Really a Business Pursuit? A Comment on Dwello v. American Reliance Insurance Company, 1 NEV. L.J. 323, 327 (2001)